SILVER SPRING, MD -- (MARKET WIRE) -- March 29, 2007 -- The ongoing patent dispute between
Verizon and Vonage signals the looming end of independent Internet phone
providers as a major force in the residential voice business, market
research provider Pike & Fischer concludes in a new report.

The two companies have been locked in a lawsuit over the use of technology
that connects Internet phone calls to traditional phone lines, and Vonage
faces similar complaints from other companies -- including Sprint.
Publicity over the patent disputes will leave many customers skeptical
about the future of Vonage, a company already suffering from slowing
subscriber growth and ongoing financial problems, Pike & Fischer says in
its analysis.

The litigation also raises concerns about intellectual property suits being
filed against other independent broadband phone providers, such as Skype
and SunRocket, says Scott Sleek, director of P&F's Broadband Advisory
Services and author of the report. Those concerns will prove to be a boon
to the cable industry, Sleek said.

"These lawsuits will prompt more and more consumers to migrate to cable
digital phone services, which have not been subject to the same type of
patent disputes that have plagued services like Vonage," he said. "Cable
operators will pick up the vast majority of the customer base and
eventually force most of the independent providers out of the market."

Verizon says it has lost hundreds of thousands of customers to Vonage,
which pioneered the delivery of low-cost phone service using technology
known as Voice over Internet Protocol (VoIP). But despite crippling Vonage
as a competitor, Verizon won't become a major force in the VoIP business,
P&F says. The company has had tepid success with its own Internet phone
service, VoiceWing, and now focuses on selling its traditional phone
service in discount bundles, the report concludes.

Pike & Fischer, a BNA company, offers a host of legal and business
information products covering the telecommunications industry. "Verizon vs.
Vonage: What It Means for Residential VoIP Service" is priced at $695 and
can be purchased at www.broadbandadvisoryservices.com. For analyst
commentary or an executive summary, contact Scott Sleek at 800-255-8131 /
ssleek@pf.com.